Three years after college, less than half of former college students are paying down their student loans. Only 46 percent of borrowers “pay even a dollar towards their principal loan balance three years after leaving school,” write Kim Dancy and Ben Barrett of New America.
After fixing an error in its repayment rate calculations, the U.S. Education Department reports much lower repayment rates.
|Years After Entering Repayment||Old Repayment Rate||Corrected Repayment Rate|
An increasing number of former students are using deferral or income-driven repayment (IDR) options. Those who pay some of the interest, but none of the principal, are not listed as repaying their loans.